By the looks of Sprint Corp.'s (S) latest earnings report, the positive influence of Sprint's new majority owner, Japan's Softbank Corp. (TYO:9984) may be taking hold. Sprint shares are up 7.5+ percent in early trading on account of the good news.

I. Customer Gain is Happy Surprise

Softbank won a bidding war for America's third largest carrier, and closed the 80 percent stake purchase in early July. But in Q3 2014, Sprint showed few signs of change, posting accounts of customer defections and monetary losses that have become unfortunately expected from Sprint in recent years.

But just announced results for Q4 2013 earnings showed a remarkable shift.

Analysts surveyed by Thomson Reuters I/B/E/S were generally gloomy coming in, predicting anywhere from 48,000 to 400,000 net customer losses, with an average expectation of 83,500 net losses. Instead Sprint not only cut down on the 400,000 net customer loss of Q3, it reversed it altogether, unexpectedly adding 58,000 net postpaid subscribers.

Sprint is spending big on its LTE rollout, but appears to be turning the corner on subscriptions and earnings. [Source: Sun Journal]

That figure is for the "Sprint platform", which includes subscribers to the recently acquired Clearwire and U.S. Cellular networks. Counting only Sprint's own branded postpaid network, Sprint did see a small loss of 69,000 customers, but that was substantially better than the average expectation of 371,000 subscribers that eight analysts surveyed by Bloomberg predicted, on average.

Including postpaid subscribers on all its platforms -- including tablets and prepaid customers -- Sprint saw 682,000 net customer additions. Sprint says it added 466,000 tablet customers during the quarter.

In 2013 Adjusted EBITDA* and Sprint platform wireless revenues grew significantly while we made investments to improve network performance and expand 4G LTE to more than 200 million people. As we roll out Sprint SparkTM and create innovative offers like Sprint FramilySM, we are building a foundation for future success.

Sprint cut churn -- a measure of customers defection rates -- on both its prepaid and postpaid platforms. The carrier ended the quarter with over 55 million subscribers.

II. Losses Narrow, Even as Sprint Spends Big in LTE Race

Revenue came in at $9.14B USD, with average revenue per user (ARPU) of $64.07 USD/user. That was up from $9.01B USD a quarter ago. The revenue numbers beat average analyst expectations of $8.97B USD and $8.99B USD from Thomson Reuters I/B/E/S and Bloomberg, respectively. And the ARPU was slightly better than the $64.01 the Bloomberg surveyed analysts predicted, on average.

Sprint still did lose $1.038B USD for the quarter. That's up from the $699M USD it lost in Q3, but it trims the $1.321B USD net loss of a year ago. The Thomson Reuters I/B/E/S surveyed analysts predicted an average net loss of $1.317B USD.

Coverage-wise, Sprint did improve its network modestly, growing its LTE coverage to 200 million Americans. Sprint now covers most urban areas in the U.S., but trails the coverage of top U.S. carrier Verizon Wireless (a subsidiary of Verizon Inc. (VZ)). In January Sprint wrote that it hopes to cover 250 million Americans -- or just under five out of every six Americans -- by "mid-2014".

Sprint's Spark program is bringing advanced LTE technology to select U.S. markets.

Sprint also kicked off its advanced LTE efforts with "Spark", a new high-speed cellular data service that debuted in 11 initial markets in mid-January:

Austin, Texas

Chicago

Dallas

Fort Lauderdale, Fla.

Fort Worth, Texas

Houston

Los Angeles

Miami

New York

San Antonio, Texas

Tampa, Fla.

Spark offered peak data downlink speeds of 50-60 Megabits per second (Mbps). The carrier plans to gradually add Spark services in more markets, but it will be a slow process, as serious infrastructure upgrades are needed. Sprint also says its eventual goal is to reach peak network speeds of around 2 Gigabits per second (Gbps) -- roughly 40 times current peak Spark speeds. In October, Sprint demoed a 1 Gbps connection at its labs.

The carrier will spend $16B USD over the next two years -- including an estimated $8B USD this year -- to expand its LTE coverage and improve its nationwide infrastructure to compete with Verizon and second-place AT&T Inc. (T).

III. T-Mobile Deal in Jeopardy

In terms of plans Sprint pleased customers with its new "Framily" plans, which offered pooled discounts for friends and family, with separate bills for each member.

Speaking of T-Mobile, all eyes will be on Sprint and its majority owner Softbank, who are reportedly contemplating a bid for T-Mobile USA, a move to merge the nation's third and fourth largest carrier, leaving only three large carriers in the U.S. mobile market. T-Mobile USA owner Deutsche Telekom AG (ETR:DTE) has expressed interest in selling its now profitable and thriving subsidiary, but regulators have suggested that they may file lawsuits to block a purchase by Sprint.

Last month Sprint CEO Dan Hesse and Softbank CEO Masayoshi Son met with U.S. Federal Communications Commissions (FCC) regulators to try to sell them on the plan. But reportedly the meeting did not go well, leaving the prospect of a bid uncertain.

Given Sprint's decision to kill early upgrades T-Mobile USA customers may not be too disappointed at that news.

Sprint's original Los Angeles infrastructure was built under contract by a company whose name escapes me at the moment. But they cut costs by building according to the extreme specs of the technology - spacing the towers as far apart as possible. I wouldn't be surprised if San Francisco had the same thing happen.

By the time Sprint caught on that there was a problem, the towers had already been built. If you have a bunch of towers spaced 7 miles apart, and they really need to be spaced 5 miles apart for decent coverage, you can't exactly pick up towers and move them around. So they were stuck with poorly spaced towers and had to supplement it with peering contracts with Verizon. At first that wasn't so bad, but a few years ago my Sprint speeds on Verizon towers got downgraded to 2G speeds. Something about their peering agreement changed. That sounds like what you were experiencing. (Yes Sprint sued the contractor.)

Sprint is horrible i can't wait til june when my etf goes down to 100.00 so i can go to T-mobile. My brother's T-mo gs4 gets great speeds and usually nothing less than regular 4g in south orange county and north county san diego. My sprint phone gets the occasional lte but usually only 3g which is unusable. I hope sprint doesn't buy t-mo so they can kill off the jump program.